Central city fiscal strains: the public costs of private growth

Abstract

Corporate and union power shaped city responses to the violent breakdown in social control. Public employment expanded rapidly in the wake of the riots, as cities attempted to pacify those who found little place in the city’s emerging economy. This imposed new costs on the public budget. Corporate and union power also shaped the city response to the constraints on economic growth. Public capital spending, such as urban renewal, also grew in response to the emerging office economy. This too imposed new costs on the public budget. Did the public policies of social control and economic growth have a role in generating fiscal strain, the symptoms of which first became visible in the 1970s? How effective was the new economic growth in counteracting the fiscal strains normally attributed to industrial and residential decline?